Gas Stations May Now Charge $175 to Cards When Paying at the Pump
By: Laura Mugge
Due to recent gas prices in the US, payment processing companies have increased the limit for holds placed on customer cards when they pay for gas at the pump. Visa and Mastercard raised the limit for gas station holds from $125 to $175 early in 2022. This means gas stations may place holds up to $175 on credit and debit cards used to purchase gas at the pump, reports the Wall Street Journal.
When a gas station customer typically swipes a credit or debit card before pumping the gas, there is no way for the retailer to know how much the customer may spend. To overcome this, they place a pre-authorization charge on the customer’s card to ensure enough funds or credit are available in the account to cover even the largest possible purchase. After the customer has finished pumping, their card is charged for the amount pumped, and the holding charge is typically released in two hours, according to Visa and MasterCard. Still, some debit-card holds might last longer based on the merchant's network.
Gas stations are not the only retailers to place holds on cards. Rental car and hospitality companies, such as hotels, also use holds because the businesses want to ensure they are protected if the final bill for services exceeds the initial amount.
Here’s what you can do to avoid a hold on your credit or debit card when you’re at the pump:
Use Cash - If possible, withdraw cash from an ATM that does not charge fees and use the money to pay for a specified amount before you pump the gas.
Know Your Balance and Pay Ahead Inside – Don’t want to miss out on your card’s points or cash back benefits by using cash? It's possible to continue using your credit or debit card without worrying about getting hit with a massive hold. Pay inside before you pump and tell the attendant exactly how much you want to charge to the card. Before you do this, checking your account balance is a good idea to ensure enough funds are available on your card.
Look for a Notice at the Pump or Ask the Attendant About the Station’s Hold Policy - Gas stations vary regarding how much they choose to hold. It could be only $1 or up to $175. Some stations display a sign on the pump that clearly states the hold amount. Suppose there is no stated policy displayed at the pump. In that case, a trip inside the store may be necessary to request the hold policy from a manager or attendant.
These holds could temporarily max out the credit limit on a credit card or the available balance on a debit card, both leading to potential declines until the temporary hold is released. Keeping up-to-date on these trends and changes and closely monitoring your account’s available balance before you make a purchase will help keep you financially secure.
Electro Savings members can conveniently monitor their account’s available balance using our Digital Banking Services.